Office In the Home Deduction

Article Posted on 09/02/2021

However, if you are a small business owner (other than an owner of a C or S Corporation) or self-employed and work from home, you may have more of an advantage of deducting office in the home from your Schedule C or partnership income.  To qualify for office in the home you must meet the following: 

  1. The space in your home needs to be exclusively used for a home office for your business. It cannot be a nook in the kitchen or a spare bedroom.  It must be a separately identifiable space.  (This would not include in home daycares or areas used to store inventory or product samples) 


  1. You need to use the space on a regular basis. Normally, it would be 10 – 12 hours a week in your office. 


  1. You must show that you use your home as your principal place of business.   If you conduct business at a location outside of your home, then you must show that you do not conduct substantial administrative or management duties anywhere else, for example bookkeeping, ordering supplies, payroll, marketing.                     


  1. This will need to be documented. It is recommended to keep track of the number of hours that you worked in the home office and what type of administrative tasks you were performing.   


If you meet the above qualifications, you may be able deduct a percentage of your home (used for the trade of business) expense such as mortgage interest (rent expense if you do not own your home) real estate taxes, homeowner’s insurance, some utilities, repairs, and depreciation. 

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